Coffee shops are a consumer favorite, especially if you can offer great wifi at a convenient location along with a relaxing or trendy atmosphere. If it has been your dream to open your own coffee shop, your first priority should be market research. How many coffee shops can area support, and how many exist in the area where you hope to open?
Once you feel confident you have found the right area, the next priority is location. Coffee shops do well in high-traffic locations. People need to see your business to think about stopping in, but those areas can mean high rent prices. You may have to sacrifice some visibility to get into affordable rent, which means you will need a better marketing plan to ensure you establish a customer base as quickly as possible.
Why is a business plan essential?
A business plan is necessary, primarily, to ensure that you can receive financing for your start-up costs. Even if you are using savings, or some other form of financing, do not skip the critical step of developing a business plan. A business plan will detail the specific steps you need to take to make your coffee shop successful.
A comprehensive business plan for your coffee shop will detail your short and long-term objectives, which will help you remain on track to build a successful business. Think of your business plan as a detailed to-do list that will grow and evolve along with your business. A business plan also helps you remain focused on the details and numbers that will determine the success of your coffee shop.
The most important details of a business plan
There are numerous sample business plans that you can find online, but crafting a plan that is specific to the needs of a coffee shop is critical for success. The first draft should follow an outline that covers the important areas of:
- Market research—Market research is something you will update throughout the life of your business. It is vital for a start-up, but it continues to be important for increasing sales and remaining competitive as your business grows. For a coffee shop, the areas you need to focus on are understanding your target market and information about the competition. You will also need a detailed analysis of whether the market is oversaturated.
- Sales strategy—This will be the area of the business plan where you lay out what will set your coffee shop apart from other similar businesses in the area. Why will customers return again and again to feed their coffee addiction at your location? For a small business, a reliable base of repeat customers is essential, so how do you plan to win the loyalty of customers?
- Capital—Starting any new business takes money, and a coffee shop is no exception. You will need to research the costs of rent, renovations, and how much quality machinery costs to get started. Even if you have a prime location and a great business model, it will take time to build up a customer base, so capital is also what will help you cover overhead until the coffee shop is making a profit.
- Labor requirements and financial data—How many people will you need on staff to cover the hours you plan to operate? What will be the costs of employing these people? Financial data includes anything that might convince a lender to loan you money for your business start-up, including account statements that show you have money of your own to invest in the business.
A business plan will be one document with sections that cover the above information. Many people include a mission statement, which is a formal description of what you hope to accomplish by opening this coffee shop. When you envision the business, what things are most important? Do you plan to create a cozy place for people to come together, or is it quiet place packed with students and business people working while enjoying their favorite brew? The vision you have should be included in your plan, and it may grow and change along with your business.